On Sept. 11, Americans entered a new and frightening geography,
where the continents of safety and danger seemed forever shifted.

Is it safe to fly? Will terrorists wage germ warfare? Where is the
line between reasonable precaution and panic? Jittery, uncertain and
assuming the worst, many people have answered these questions by
forswearing air travel, purchasing gas masks and radiation detectors,
placing frantic calls to pediatricians demanding vaccinations against
exotic diseases or rushing out to fill prescriptions for Cipro, an
antibiotic most experts consider an unnecessary defense against anthrax.
(3)

I. RISKS, NUMBERS, AND REGULATION

Consider the following problems:

* People live in a community near an abandoned hazardous waste site. The community appears to suffer from an unusually high number of
deaths and illnesses. Many members of the community fear that the
hazardous waste site is responsible for the problem. Administrative
officials attempt to offer reassurance that the likelihood of adverse
health effects, as a result of the site, is extremely low. (4) The
reassurance is met with skepticism and distrust.

* An airplane, carrying people from New York to California, has
recently crashed. Although the source of the problem is unknown, many
people suspect terrorism. In the following weeks, many people who would
otherwise fly are taking trains or staying home. Some of those same
people acknowledge that the statistical risk is exceedingly small.
Nonetheless, they refuse to fly, in part because they do not want to
experience the anxiety that would come from flying.

* An administrative agency is deciding whether to require labels on
genetically modified food. According to experts within the agency,
genetically modified food, as such, poses insignificant risks to the
environment and to human health. But many consumers disagree. Knowledge
of genetic modification triggers strong emotions, and the labeling
requirement is thought likely to have large effects on consumer choice,
notwithstanding expert claims that the danger is trivial.

How should we understand human behavior in cases of this sort? My
principal answer, the thesis of this Essay, is that when intense
emotions are engaged, people tend to focus on the adverse outcome, not
on its likelihood. That is, they are not closely attuned to the
probability that harm will occur. At the individual level, this
phenomenon, which I shall call "probability neglect," produces
serious difficulties of various sorts, including excessive worry and
unjustified behavioral changes. When people neglect probability, they
may also treat some risks as if they were nonexistent, even though the
likelihood of harm, over a lifetime, is far from trivial. Probability
neglect can produce significant problems for law and regulation. As we
shall see, regulatory agencies, no less than individuals, may neglect
the issue of probability, in a way that can lead to either indifference
to real risks or costly expenditures for little or no gain. If agencies
are falling victim to probability neglect, they might well be violating
relevant law. (5)

Indeed, we shall see that the idea of probability neglect helps
illuminate a number of judicial decisions, which seem implicitly attuned
to that idea, and which reveal an implicit behavioral rationality in
important pockets of federal administrative law. As we shall also see,
an understanding of probability neglect helps show how government can
heighten, or dampen, public concern about hazards. Public-spirited
political actors, no less than self-interested ones, can exploit
probability neglect so as to promote attention to problems that may or
may not deserve public concern. It will be helpful to begin, however,
with some general background on individual and social judgments about
risks.

A. Cognition

On the conventional view of rationality, probabilities matter a
great deal to reactions to risks. But emotions, as such, are not
assessed independently; they are not taken to play a distinctive role.
(6) Of course, people might be risk-averse or risk-inclined. For
example, it is possible that people will be willing to pay $100 to
eliminate a 1/1000 risk of losing $900. But analysts usually believe
that variations in probability should matter, so that there would be a
serious problem if people were willing to pay both $100 to eliminate a
1/1000 risk of losing $900 and $100 to eliminate a 1/100,000 risk of
losing $900. Analysts do not generally ask, or care, whether
risk-related dispositions are a product of emotions or something else.

Of course, it is now generally agreed that in thinking about risks,
people rely on certain heuristics and show identifiable biases. (7)
Those who emphasize heuristics and biases are often seen as attacking
the conventional view of rationality. (8) In a way they are doing just
that, but the heuristics-and-biases literature has a highly cognitive
focus, designed to establish how people proceed under conditions of
uncertainty. The central question is this: When people do not know about
the probability associated with some risk, how do they think? It is
clear that when people lack statistical information, they rely on
certain heuristics, or rules of thumb, which serve to simplify their
inquiry. (9) Of these rules of thumb, the "availability
heuristic" is probably the most important for purposes of
understanding risk-related law. (10) Thus, for example, "a class
whose instances are easily retrieved will appear more numerous than a
class of equal frequency whose instances are less retrievable."
(11) The point very much bears on private and public responses to risks,
suggesting, for example, that people will be especially responsive to
the dangers of AIDS, crime, earthquakes, and nuclear power plant
accidents if examples of these risks are easy to recall. (12)

This is a point about how familiarity can affect the availability
of instances. But salience is important as well. "The impact of
seeing a house burning on the subjective probability of such accidents
is probably greater than the impact of reading about a fire in the local
paper." (13) So, too, recent events will have a greater impact than
earlier ones. The point helps explain much risk-related behavior. For
example, whether people will buy insurance for natural disasters is
greatly affected by recent experiences. (14) If floods have not occurred
in the immediate past, people who live on flood plains are far less
likely to purchase insurance. (15) In the aftermath of an earthquake,
the proportion of people carrying earthquake insurance rises
sharply--but it declines steadily from that point, as vivid memories
recede. (16) For purposes of law and regulation, the problem is that the
availability heuristic can lead to serious errors of fact, in terms of
both excessive controls on small risks that are cognitively available
and insufficient controls on large risks that are not. (17)

The cognitive emphasis of the heuristics-and-biases literature can
be found as well in prospect theory, a departure from expected utility
theory that explains decision under risk. (18) For present purposes,
what is most important is that prospect theory offers an explanation for
simultaneous gambling and insurance. (19) When given the choice, most
people will reject a certain gain of X in favor of a gamble with an
expected value below X, if the gamble involves a small probability of
riches. At the same time, most people prefer a certain loss of X to a
gamble with an expected value less than X, if the gamble involves a
small probability of catastrophe. (20) If expected utility theory is
taken as normative, then people depart from the normative theory of
rationality in giving excessive weight to low-probability outcomes when
the stakes are high. Indeed, we might easily see prospect theory as
emphasizing a form of probability neglect. But in making these
descriptive claims, prospect theory does not specify a special role for
emotions. This is not a puzzling oversight, if it counts as an oversight
at all. For many purposes, what matters is what people choose, and it is
unimportant to know whether their choices depend on cognition or
emotion, whatever may be the difference between these two terms.

B. Emotion

No one doubts, however, that in many domains, people do not think
much about variations in probability and that emotions have a large
effect on judgment and decisionmaking. (21) Would a group of randomly
selected people pay more to reduce a 1/100,000 risk of getting a
gruesome form of cancer than a similar group would pay to reduce a
1/200,000 risk of getting that form of cancer? Would the former group
pay twice as much? With some low-probability events, anticipated and
actual emotions, triggered by the best-case or worst-case outcome, help
to determine choice. Those who buy lottery tickets, for example, often
fantasize about the goods associated with a lucky outcome. (22) With
respect to risks of harm, many of our ordinary ways of speaking suggest
strong emotions: panic, hysteria, terror. People might refuse to fly,
for example, not because they are currently frightened, but because they
anticipate their own anxiety, and they want to avoid it. It has been
suggested that people often decide as they do because they anticipate
their own regret. (23) The same is true for fear. Knowing that they will
be afraid, people may refuse to travel to Israel or South Africa, even
if they would much enjoy seeing those nations and even if they believe,
on reflection, that their fear is not entirely rational. Recent evidence
is quite specific. (24) It suggests that people greatly neglect
significant differences in probability when the outcome is "affect
rich"--when it involves not simply a serious loss, but one that
produces strong emotions, including fear. (25)

To be sure, the distinction between cognition and emotion is
complex and contested. (26) In the domain of risks, and most other
places, emotional reactions are usually based on thinking; they are
hardly cognition-free. When a negative emotion is associated with a
certain risk--pesticides or nuclear power, for example--cognition plays
a central role. (27) For purposes of the analysis here, it is not
necessary to say anything especially controversial about the nature of
the emotion of fear. The only suggestion is that when emotions are
intense, calculation is less likely to occur, or at least that form of
calculation that involves assessment of risks in terms of not only the
magnitude but also the probability of the outcome.

Drawing on and expanding the relevant evidence, I will emphasize a
general phenomenon here: In political and market domains, people often
focus on the desirability of the outcome in question and pay (too)
little attention to the probability that a good or bad outcome will, in
fact, occur. It is in such cases that people fall prey to probability
neglect, which is properly treated as a form of quasi-rationality. (28)
Probability neglect is especially large when people focus on the worst
possible case or otherwise are subject to strong emotions. When such
emotions are at work, people do not give sufficient consideration to the
likelihood that the worst case will actually occur. This is
quasi-rational because, from the normative point of view, it is not
fully rational to treat a 1% chance of X as equivalent, or nearly
equivalent, to a 99% chance of X, or even a 10% chance of X. Because
people suffer from probability neglect, and because neglecting
probability is not fully rational, the phenomenon I identify raises new
questions about the widespread idea that ordinary people have a kind of
rival rationality superior to that of experts. (29) Most of the time,
experts are concerned principally with the number of lives at stake,
(30) and for that reason they will be closely attuned, as ordinary
people are not, to the issue of probability.

By drawing attention to probability neglect, I do not mean to
suggest that most people, most of the time, are indifferent to large
variations in the probability that a risk will come to fruition. Large
variations can, and often do, make a difference--but when emotions are
engaged, the difference is far less than the standard theory predicts.
Nor do I suggest that probability neglect is impervious to
circumstances. If the costs of neglecting probability are placed
"on screen," then people will be more likely to attend to the
question of probability. (31) In this light it is both mildly
counterintuitive and reasonable, for example, to predict that people
would be willing to pay less, in terms of dollars and waiting time, to
reduce low-probability risks of an airplane disaster if they are
frequent travelers. An intriguing study finds exactly that effect. (32)
For similar reasons, market pressures are likely to dampen the impact of
probability neglect, ensuring that, say, risks of 1/10,000 are treated
differently from risks of 1/1,000,000, even if individuals, in surveys,
show relative insensitivity to such differences.

Acknowledging all this, I emphasize three central points. First,
differences in probability will often affect behavior far less than they
should or than conventional theory would predict. Second, private
behavior, even when real dollars are involved, (33) can display
insensitivity to the issue of probability, especially when emotions are
intensely engaged. Third, and most important, the demand for legal
intervention can be greatly affected by probability neglect, so that
government may end up engaging in extensive regulation precisely because
intense emotional reactions are making people relatively insensitive to
the (low) probability that the relevant dangers will ever come to
fruition.

C. Law

It is not at all clear how the law should respond to probability
neglect. But at a minimum, the phenomenon raises serious legal issues in
administrative law, at least under statutes banning agencies from acting
unless they can show a "significant risk" (34) or can
establish that the benefits of regulation outweigh the costs. (35) If
agencies are neglecting the issue of probability (perhaps because the
public is doing so as well), they may well be acting unlawfully. Indeed,
the law of judicial review shows an inchoate understanding of
probability neglect, treating it as a problem for which judicial
invalidation is a solution. (36) The only qualification is that the
relevant law remains in an embryonic state. There is much to be done,
especially at the agency level, to ensure that government is alert to
the probability that harm will actually occur.

Outside of the context of administrative law, an understanding of
probability neglect will help us to make better predictions about the
public "demand" for law. When a bad outcome is highly salient
and triggers strong emotions, government will be asked to do something
about it, even if the probability that the bad outcome will occur is
low. Political participants of various stripes, focusing on the worst
case, are entirely willing to exploit probability neglect. Those who
encourage people to purchase lottery tickets, focusing on the best case,
do the same. An understanding of probability neglect simultaneously
helps show why jurors, and ordinary officials, are not likely to be
moved much by a showing that before the fact, the harm was not likely to
occur. For many people, what matters is that the harm did occur, not
that it was unlikely to do so before the fact.

For law, many of the most difficult questions are normative in
character: Should government take account of variations in the
probability that harms will occur? Should government respond to intense
fears that involve statistically remote risks? When people suffer from
probability neglect, should law and policy do the same thing? At first
glance, we might think that even if people are neglecting probability,
government and law at least should not--that the tort system and
administrators should pay a great deal of attention to probability in
designing institutions. If government wants to insulate itself from
probability neglect, it will create institutions designed to ensure that
genuine risks, rather than tiny ones, receive the most concern. Such
institutions will not necessarily require agencies to discuss the
worst-case scenario. (37) And if government is attempting to increase
public concern about a genuine danger, it should not emphasize
statistics and probabilities, but should instead draw attention to the
worst-case scenario.

If government is attempting to decrease public concern with a risk
that has a tiny probability of coming to fruition, it may be ineffective
if it emphasizes the issue of probability; indeed, it may do better if
it changes the subject or stresses instead the affirmative social values
associated with running the risk. (38) On the other hand, public fear,
however unwarranted, may be intractable, in the sense that it may be
impervious to efforts at reassurance. And if public fear is intractable,
it will cause serious problems, partly because fear is itself extremely
unpleasant and partly because fear is likely to influence conduct,
possibly producing wasteful and excessive private precautions. If so, a
governmental response, via regulatory safeguards, would appear to be
justified if the benefits, in terms of fear reduction, justify the
costs.

II. PROBABILITY NEGLECT: THE BASIC PHENOMENON

When it comes to risk, a key question is whether people can imagine
or visualize the worst-case outcome. (39) When the worst case produces
intense fear, surprisingly little role is played by the stated
probability that that outcome will occur. (40) An important function of
strong emotions is thus to drive out quantitative judgments, including
judgments about probability, by making the best case or the worst case
seem highly salient. (41) But it is important to note that probability
neglect can occur even when emotions are not involved. A great deal of
evidence shows that whether or not emotions are involved, people are
relatively insensitive to differences in probabilities, at least when
the relevant probabilities are low.

A. Insensitivity to Variations Among Low Probabilities

Do people care about probability at all? Of course they do; a risk
of 1/100,000 is significantly less troublesome than a risk of 1/1000.
But many people, much of the time, show a remarkable unwillingness to
attend to the question of probability. Several studies show that when
people are seeking relevant information, they often do not try to learn
about probability at all. One study, for example, finds that in deciding
whether to purchase warranties for consumer products, people do not
spontaneously point to the probability of needing repair as a reason for
the purchase. (42) Another study finds that those making hypothetical,
risky managerial decisions rarely ask for data on probabilities. (43) Or
consider a study involving children and adolescents, (44) in which the
following question was asked:

Susan and Jennifer are arguing about whether they should wear seat belts
when they ride in a car. Susan says that you should. Jennifer says you
shouldn't.... Jennifer says that she heard of an accident where a car fell
into a lake and a woman was kept from getting out in time because of
wearing her seat belt.... What do you think about this? (45)

In answering that question, many subjects did not think about
probability at all. (46) One exchange took the following form:

A: Well, in that case I don't think you should wear a seat
belt.

Q (interviewer): How do you know when that's gonna happen?

A: Like, just hope it doesn't!

Q: So, should you or shouldn't you wear seat belts?

A: Well, tell-you-the-truth we should wear seat belts.

Q: How come?

A: Just in case of an accident. You won't get hurt as much as
you will if you didn't wear a seat belt.

Q: Ok, well what about these kinds of things, when people get
trapped?

A: I don't think you should, in that case. (47)

These answers might seem odd and idiosyncratic, but we might
reasonably suppose that some of the time, both children and adults focus
primarily on bad scenarios, without thinking a great deal about the
question of probability.

Many studies find that significant differences in low probabilities
have little impact on decisions. This finding is in sharp conflict with
the standard view of rationality, which suggests that people's
willingness to pay for small risk reductions ought to be nearly
proportional to the size of the reduction. (48) Perhaps these findings
reflect people's implicit understanding that in these settings, the
relevant probability is "low, but not zero," and that finer
distinctions are unhelpful. (What does a risk of 1/100,000 really mean?
How different is it, for an individual, from a risk of 1/20,000 or
1/600,000?) In an especially striking study, Kunreuther and his
coauthors found that mean willingness to pay insurance premiums did not
vary among risks of 1/100,000, 1/1,000,000, and 1/10,000,000. (49) They
also found basically the same willingness to pay for insurance premiums
for risks ranging from 1/650, to 1/6300, to 1/68,000. (50)

The study just described involved a "between subjects"
design; subjects considered only one risk, and the same people were not
asked to consider the various risks at the same time. Low probabilities
are not likely to be terribly meaningful to most people, but most
educated people would know that a 1/100,000 risk is worse than
1/1,000,000 risk. When low-probability risks are seen in isolation and
are not assessed together, we have an example of the problem of
"evaluability." (51) For most people, most of the time, it is
very difficult to evaluate a low probability, and hence isolated
decisions will pick up small or no variations between people's
assessments of very different risks.

But several studies have a "within subjects" design,
exposing people simultaneously to risks of different probabilities, and
even here, the differences in probabilities have little effect on
decisions. An early study examined people's willingness to pay
(WTP) to reduce various fatality risks. The central finding was that the
mean WTP to reduce such risks was, for over 40% of the respondents,
unaffected by a large variation in the probability of harm, even though
expected utility theory would predict significant effects from such
variations. (52) A later study found that for serious injuries, WTP to
reduce the risk by 12/100,000 was only 20% higher than WTP to reduce the
same risk by 4/100,000, even though standard theory would predict a WTP
three times as high. (53) These results are not unusual. Lin and Milon
attempted to elicit people's willingness to pay to reduce the risk
of illness from eating oysters? There was little sensitivity to
variations in probability of illness. (55) Another study found little
change in WTP across probability variations involving exposure to
pesticide residues on fresh produce. (56) A similar anomaly was found in
a study involving hazardous wastes, where WTP actually decreased as the
stated fatality risk reduction increased. (57)

There is much to say about the general insensitivity to significant
variations within the category of low-probability events. It would be
difficult to produce a rational explanation for this insensitivity;
recall the standard suggestion that WTP for small risk reductions should
be roughly proportional to the size of the reduction. (58) Why
don't people think in this way? An imaginable explanation is that
in the abstract, most people simply do not know how to evaluate low
probabilities. A risk of 7/100,000 seems "small"; a risk of
4/100,000 also seems "small." (59) Most people would prefer a
risk of 4/100,000 to a risk of 7/100,000, and I have noted that joint
evaluation improves evaluability, which would otherwise be extremely
difficult. (60) But even when the preference is clear, both risks seem
"small," and hence it is not at all clear that a proportional
increase in WTP will follow. As suggested by the findings of Kunreuther
and his coauthors, it is likely that in a between-subjects design, WTP
to eliminate a risk of 4/100,000 would be about the same as WTP to
eliminate a risk of 7/100,000, simply because the small difference would
not matter when each risk is taken in isolation.

Note also that the studies just described involve contingent
valuation, not real world choices. A significant question is whether and
when actual behavior, in consumer choice or political judgment, shows a
general neglect of differences among low probabilities. In labor
markets, for example, are risks of 4/100,000 compensated at about the
same level as risks of 7/100,000? If so, this would be a serious market
failure. There appears to be no clear data on the question. (61) But we
might expect that risk markets will reduce the problem of neglect, if
only because some number of people will appreciate the relevant
differences and drive wages and prices in the appropriate direction.
Consider an analogy: Most people probably do not know whether the right
price for many consumer items is what it now is, or 120% or 80% of what
it now is. Small price differences would not matter to most consumers,
at least for expensive products, and a consumer survey might well
suggest that a modest increase or decrease in price would have no effect
on most people. But lower-priced products will sell more, and hence
markets will pick up differences that do not matter to, or even register
for, most consumers. Perhaps risk markets work in the same way.

Quite apart from the effects of markets, some imaginative studies
attempt to overcome probability neglect through visual aids (62) or
through providing a great deal of information about comparison scenarios
located on a probability scale. (63) Without these aids, it is not so
surprising that differences in low probabilities do not matter much to
many people. For most of us, most of the time, the relevant
differences--between, say, 1/100,000 and 1/1,000,000--are not pertinent
to our decisions, and by experience we are not well equipped to take
those differences into account.

B. Safe or Unsafe? Of Thresholds and Certainty

A form of probability neglect can also be seen in the fact that
people seem to treat situations as "safe" or
"unsafe," without seeing that the real question is the
likelihood of harm. (64) Consider, for example, this remarkable
discussion of the effects of natural disasters:

One of the bargains men make with one another, in order to maintain their
sanity is to share an illusion that they are safe, even when the physical
evidence in the world around them does not seem to warrant that conclusion.
The survivors of a disaster, of course, are prone to overestimate the
perils of their situation, if only to compensate for the fact that they
underestimated those perils once before; but what is worse, far worse, is
that they sometimes live in a state of almost constant apprehension because
they have lost the human capacity to screen the signs of danger out of
their line of vision. (65)

What is most notable about this passage is the sharp division
between ordinary people, who "share an illusion that they are
safe," and those subject to a natural disaster, who "sometimes
live in a state of almost constant apprehension." Part of the
reason for the illusion is that people tend to be unrealistically
optimistic. (66) As a result, many low-level risks do not register at
all. A related reason is that people tend to reduce cognitive
dissonance, sometimes by treating risks as if they were insignificant,
even worth ignoring. (67) When people think that they are
"safe," even though they face a statistical risk, they might
well be responding to emotions, seeking to avoid the anxiety that comes
from an appreciation of the inevitability of risk. In part because
people tend to be unrealistically optimistic, (68) many low-level risks
do not register at all. At the individual level, a decision to disregard
low-level risks is far from irrational, even if it is based in whole or
in part on emotions; we lack the information that would permit
fine-grained risk judgments, and when the probability really is low, it
may be sensible to treat it as if it were zero. Of course, regulators
should do better, if only because they are typically dealing with large
populations, and a risk that is best ignored at the individual level,
say 1/500,000, will deserve a good deal of attention if it is faced by
200 million people. And as the passage also suggests, risks can suddenly
come "on screen," making people believe that where they once
were "safe," they are now "unsafe." Of course, a
form of probability neglect is at work when risks are placed into these
two categories.

Experimental work strongly supports this conclusion. With respect
to the decision whether to insure against low-probability hazards,
people show bimodal responses. (69) When a risk probability is below a
certain threshold, people treat the risk as essentially zero and are
willing to pay little or nothing for insurance in the event of loss. But
when the risk probability is above a certain level, people are willing
to pay a significant amount for insurance, indeed an amount that greatly
exceeds the expected value of the risk. (70) Such bimodal responses
provide further support for the intuitive suggestion that some risks are
simply "off-screen," whereas others, statistically not much
larger, can come "on-screen" and produce behavioral changes.
And indeed, one study finds that when told that the probability of being
killed in an accident is only 0.00000025 per trip, ninety percent of
people said that they would not wear seatbelts--a finding apparently
based on a judgment that so small a probability is essentially zero.
(71)

The role of thresholds is connected with an aspect of prospect
theory, emphasizing the great importance of certainty to people's
decisions. (72) People are willing to pay relatively little for a small
increment in safety, but they will pay far more when the additional
increment is the last one, eliminating any risk at all. (73) A change in
a risk from 0.04 to 0.03 will produce far less enthusiasm than a change
from 0.01 to zero. This finding, commonly described as the
"certainty effect," (74) is in line with the suggestion that
people are insensitive to variations among low probabilities and instead
ask, much of the time, whether they are in the domain of the
"safe" or the "unsafe."

I now turn from the general neglect of differences in low
probabilities to the particular role of strong emotions in crowding out
close attention to the issue of probability, both low and not so low. My
central claim is that when strong emotions are involved, large-scale
variations in probabilities will matter surprisingly little--even when
the variations unquestionably matter when emotions are not triggered.
The point applies to hope as well as to fear; vivid images of good
outcomes will crowd out consideration of probability too. (75) Lotteries
are successful partly for this reason. (76) Consider this account:

They didn't really know what the odds--1 in 76 million--mean. Big dreams
are easier than big odds; to be precise, in the 11 p.m. drawing, there is
only one possible winning combination out of 76,275,360.... Clarence
Robinson, a manager at Macy's, said: "One in 76 million people right? It's
just a number. I'll win." (77)

But the subject here is fear rather than hope.

C. A Simple Demonstration

The basic point has received its clearest empirical confirmation in
a striking study of people's willingness to pay to avoid electric
shocks. (78) The central purpose of the study was to test the relevance
of probability in "affect rich" decisions. The experiment of
central importance here attempted to see whether varying the probability
of harm would matter more, or less, in settings that trigger strong
emotions than in settings that seem relatively emotion-free. In the
"strong emotion" setting, participants were asked to imagine
that they would participate in an experiment involving some chance of a
"short, painful, but not dangerous electric shock." (79) In
the relatively emotion-free setting, participants were told that the
experiment entailed some chance of a $20 penalty. Participants were
asked to say how much they would be willing to pay to avoid
participating in the relevant experiment. Some participants were told
that there was a 1% chance of receiving the bad outcome (either the $20
loss or the electric shock), others were told that the chance was 99%,
and still others were told that the chance was 100%.

The central result was that variations in probability affected
those facing the relatively emotion-free injury, the $20 penalty, far
more than they affected people facing the more emotionally evocative
outcome of an electric shock. For the cash penalty, the difference
between the median payment for a 1% chance and the median payment for a
99% chance was predictably large and indeed consistent with the standard
model: $1 to avoid a 1% chance, and $18 to avoid a 99% chance. (80) For
the electric shock, by contrast, the difference in probability made
little difference to median willingness to pay: $7 to avoid a 1% chance,
and $10 to avoid a 99% chance! (81) Apparently people will pay a
significant amount to avoid a small probability of an affect-laden
hazard, and the amount that they will pay will not vary greatly with
changes in probability.

D. A More Complex Demonstration

To investigate the role of probability and emotions in responses to
risk, I conducted an experiment asking eighty-three University of
Chicago law students to describe their maximum willingness to pay to
reduce levels of arsenic in drinking water. (82) The questions had a
high degree of realism. They were based on actual choices confronting
the Environmental Protection Agency, involving cost and benefit
information within the ballpark of actual figures used by the agency
itself. (83)

Participants were randomly sorted into four groups, representing
the four conditions in the experiment. In the first group, people were
asked to state their maximum willingness to pay to eliminate a cancer
risk of 1/1,000,000. (84) In the second group, people were asked to
state their maximum willingness to pay to eliminate a cancer risk of
1/100,000. In the third group, people were asked the same question as in
the first, but the cancer was described in vivid terms, as "very
gruesome and intensely painful, as the cancer eats away at the internal
organs of the body." In the fourth group, people were asked the
same question as in the second, but the cancer was described in the same
terms as in the third condition. In each group, participants were asked
to check off their willingness to pay among the following options: $0,
$25, $50, $100, $200, $400, and $800 or more. Notice that the
description of the cancer, in the "highly emotional"
conditions, was intended to add little information, consisting simply of
a description of many cancer deaths, though admittedly some participants
might well have thought that these were especially horrific deaths.

The central hypothesis was that the probability variations would
matter far less in the highly emotional conditions than in the less
emotional conditions. More specifically, it was predicted that
differences in probability would make little or no difference in the
highly emotional conditions--and that such variations would have real
importance in

the less emotional conditions. This prediction was meant to describe
a substantial departure from expected utility theory, which predicts
that an ordinary, risk-averse person should be willing to pay more than
10X to eliminate a risk that is ten times more likely than a risk that
he is willing to pay X to eliminate. (85) It was also expected that the
tenfold difference in probabilities--between 1/100,000 and
1/1,000,000--would not, in any condition, generate a tenfold difference
in willingness to pay.

The results for the first hypothesis are not conclusive, but point
in the predicted direction. (86) In the unemotional condition,
increasing the probability by a factor of ten produced a 173% increase
in mean WTP, from $71.25 to $194.44. In the highly emotional condition,
the increase in probability produced a smaller relative increase of 81%
in WTP, from $132.95 to $241.30. Thus, while increasing the probability
by a factor of ten increased WTP in both emotional conditions, in terms
of percentage increases, the effect was more than twice as large in the
less emotional condition compared to the emotional condition. The
difference between these increases is not statistically significant, but
the result is nonetheless highly suggestive, especially considering its
consistency with other similar findings. (87)

The second hypothesis was also supported. The increase in
probability did produce a significant overall increase of 113% in mean
WTP, from $103.57 to $220.73. (88) Consistent with other work on
probability neglect, however, varying the probability had a relatively
weak effect on WTP. The tenfold increase in the risk produced barely
more than a doubling of mean WTP. (89) It is noteworthy that in this
experiment, the relatively sophisticated participants in the study
showed far more sensitivity to, probability information than in the
studies, described above, by Kunreuther and his coauthors; (90) but even
so, the susceptibility was far less than conventional (normative) theory
would predict. (91)

From this experiment, we can offer one more potentially noteworthy
result. By itself, making, the description of the cancer more emotional
appeared to have an effect on mean WTP, raising it from $129.61 to
$188.33, although the increase was not statistically significant. (92)
If this result holds up in a larger sample, the dollar magnitude of the
effect of a minor change in description is surprisingly large. Indeed,
the effect of merely making the description of the outcome more
emotional was about half as large as a tenfold increase in actual risk.
My principal emphasis, however, is on the fact that when the question
was designed to trigger especially strong emotions, variations in
probability had little effect on WTP, far less of an effect than when
the question was phrased in less emotional terms.

E. Other Evidence

Probability neglect, when strong emotions are involved, has been
confirmed in many studies. (93) Consider, for example, experiments
designed to test levels of anxiety in anticipation of a painful electric
shock of varying intensity, to be administered after a "countdown
period" of a stated length. In these studies, the stated intensity
of the shock had a significant effect on physiological reactions. But
the probability of the shock had no effect. "Evidently, the mere
thought of receiving a shock is enough to arouse individuals, but the
precise likelihood of being shocked has little impact on level of
arousal." (94) A related study asked people to provide their
maximum buying prices for risky investments, which contained different
stated probabilities of losses and gains of different magnitudes. (95)
Happily for the standard theory, maximum buying prices were affected by
the size of losses and gains and also by probabilities. (Note that for
most people, this experiment did not involve an affect-rich
environment.) But--and this is the key point--reported feelings of worry
were not much affected by probability levels. (96) In this study, then,
probability did affect behavior, but it did not affect emotions. The
point has independent importance: Worry is an individual loss, even if
it does not influence behavior. (97) And in most of the cases dealt with
here, intense emotions drive out concern about probability, and hence
both behavior and worry are affected.

Several studies have attempted to compare how people respond to
differences in the probability of harm with how people respond to
differences in the emotions associated with certain risks. (98) These
studies hypothesized that certain low-probability risks, such as those
associated with nuclear waste radiation, produce outrage, whereas other
low-probability risks, such as those associated with radon exposure, do
not. A central finding is consistent with that stressed here: A large
difference in probability had no effect in the "high outrage"
condition, with people responding the same way to a risk of 1/100,000 as
to a risk of 1/1,000,000. (99) More striking still: Even when the risk
was identical in the nuclear waste (high outrage) and radon (low
outrage)cases, people in the nuclear waste case reported a much greater
perceived threat and a much higher intention to act to reduce that
threat. (100) Indeed, "the effect of outrage was practically as
large as the effect of a 4000-fold difference in risk between the
high-risk and low-risk conditions." (101) Efforts to communicate
the meaning of differences in risk levels, by showing comparisons to
normal risk levels, reduced the effect of outrage, but even after those
efforts, outrage had nearly the same effect as a 2000-fold increase in
risk. (102) A great deal of information appears to be necessary to
counteract the effects of strong emotions--showing that people are not
impervious to such information, but that when emotions are involved, a
great deal of careful work has to be done. (103)

It should not be surprising, in this light, that visualization or
imagery matters a great deal to people's reactions to risks. (104)
When an image of a bad outcome is easily accessible, people will become
greatly concerned about a risk, holding probability constant. (105)
Consider the fact that when people are asked how much they will pay for
flight insurance for losses resulting from "terrorism," they
will pay more than if they are asked how much they will pay for flight
insurance from all causes. (106) The evident explanation for this
peculiar result is that the word "terrorism" evokes vivid
images of disaster, thus crowding out probability judgments. Note also
that when people discuss a low-probability risk, their concern rises
even if the discussion consists mostly of apparently trustworthy
assurances that the likelihood of harm really is infinitesimal. (107)
One reason is that the discussion makes it easier to visualize the risk
and hence to fear it.

Note that if probability neglect is involved, this is not a point
about the availability heuristic, which leads people not to neglect
probability, but to answer the question of probability by substituting a
hard question (What is the statistical risk?) with an easy question (Do
salient examples readily come to mind?). (108) The point here is not
that visualization makes an event seem more probable (though this is
also often true), but that visualization makes the issue of probability
less relevant or even irrelevant. In theory, the distinction between use
of the availability heuristic and probability neglect should not be
obscure. In practice, of course, it will often be hard to know whether
the availability heuristic or probability neglect is driving behavior.

Emotional reactions to risk, and probability neglect, also account
for "alarmist bias." (109) When presented with competing
accounts of danger, people tend to move toward the more alarming
account. (110) In the key study demonstrating alarmist bias, W. Kip Viscusi presented subjects with information from two parties, industry
and government. Some subjects were given low-risk information from
government and high-risk information from industry; other subjects were
given high-risk information from government and low-risk information
from industry. The basic result was that people treated "the high
risk information as being more informative." (111) This pattern
held regardless of whether the low-risk information came from industry
or from government. Thus, people show "an irrational
asymmetry." (112) If the discussion here is correct, one reason for
this asymmetry is that information, whatever its content, makes people
focus on the worst case. There is a lesson for policy: It might not be
helpful to present people with a wide range of information, containing
both more assuring and less assuring accounts.

The most sensible conclusion is that with respect to risks of
injury or harm, vivid images and concrete pictures of disaster can
"crowd out" other kinds of thoughts, including the crucial
thought that the probability of disaster is very small. (113) "If
someone is predisposed to be worried, degrees of unlikeliness seem to
provide no comfort, unless one can prove that harm is absolutely
impossible, which itself is not possible." (114) With respect to
hope, those who operate gambling casinos and state lotteries are well
aware of the underlying mechanisms. They play on people's emotions
in the particular sense that they conjure up palpable pictures of
victory and easy living. With respect to risks, insurance companies and
environmental groups do exactly the same. The point explains "why
societal concerns about hazards such as nuclear power and exposure to
extremely small amounts of toxic chemicals fail to recede in response to
information about the very small probabilities of the feared
consequences from such hazards." (115)

F. Probability Neglect, "Rival Rationality," and Dual
Processing

When it comes to risk, why do experts disagree with ordinary
people? Many people think that the reason lies in the fact that ordinary
people have a "rival rationality." (116) On this view, experts
are concerned with statistics, and, above all, with the number of lives
at stake. (117) By contrast, ordinary people are concerned with a range
of qualitative factors that make certain risks a special cause of
concern. People care, for example, about whether risks are voluntarily
incurred, potentially controllable, inequitably distributed, especially
dreaded, and so forth. For those who believe that ordinary people
display a rival rationality, experts seem obtuse, fixated as they are on
the "bottom line" numbers. (118) On this view, experts and
ordinary people display "rival rationalities," and each
"side must respect the insights and intelligence of the
other." (119)

There is undoubtedly some truth in the idea that ordinary people
consider factors that the numbers alone obscure. People do care about
whether risks come with special pain and suffering (120) or whether they
are inequitably distributed. If the costs of risk avoidance are
especially high, government should make special efforts to reduce the
relevant risk; (121) if a risk is concentrated among poor people, or
members of a disadvantaged group, government should be particularly
concerned. But it is most doubtful that the idea of rival rationality
can explain all or even most of the disagreement between experts and
ordinary people. Often experts are aware of the facts and ordinary
people are not. And when people are far more concerned than experts
about shark attacks, or nuclear power, or terrorism, probability neglect
is a large part of the reason. Hence a form of irrationality, (122) not
a different set of values, often helps explain the different risk
judgments of experts and ordinary people.

This point is closely connected with the suggestion that an
"affect heuristic" helps explain people's concern, or
lack of concern, with certain risks. (123) When people have a strong
negative affect toward a process or product--arsenic or nuclear
power--they are not likely to think much about the question of
probability, and hence they will overreact from the normative
standpoint. Here there is irrationality, not a rival rationality. And
when people have a strong positive affect toward a process or
product--in some communities, for example, alcohol or cigarettes, or
herbal cures, or organic foods--they are not likely to think of the
risks, even when the probability of harm is not low. Here too there is
irrationality. My suggestion, then, is that probability neglect offers a
new, if partial, explanation for the division between experts and
ordinary people in thinking about social hazards--one that raises fresh
questions about claims of rival rationality. Of course, it is true that
experts have their own biases; (124) they are often wrong. The point is
not that experts are always right, but that when ordinary people
disagree with experts, it is often not because of competing value
judgments, but instead because ordinary people are more subject to
probability neglect.

Indeed, we should see probability neglect, not as a tribute to
rival rationality, but as closely connected with the idea of "dual
processing," of much recent interest in psychology, including the
psychology of fear and moral judgment. (125) According to dual-process
theories, some cognitive operations, involving "system 1" are
rapid, associative, and intuitive, whereas others, involving
"system 2," are slow, complex, and often calculative or
statistical. (126) It is clear that different sectors of the brain are
involved in different kinds of processing, with some strong emotional
reactions, including fear, bypassing the cortex, where more complex
thinking occurs. (127) In an especially interesting paper, it has been
shown that certain strong and perhaps puzzling moral reactions show
activity in brain sectors that are associated with emotions. (128) My
suggestion here is that probability neglect, above all when intense
emotions are involved, is a central example of "system 1"--of
cognitive operations that are rapid, intuitive, and noncalculative. In
many circumstances, rapid processing of this sort works extremely well,
as, for example, when someone is confronted with a bear in the forest or
a large man with a knife in a dark alley (and immediately runs away).
But governments, and people making decisions under circumstances that
permit deliberation, can do a great deal better.

G. Notes on the Media and on Heterogeneity

From what has been said thus far, it should be clear that news
sources can do a great deal to trigger fear, simply by offering examples
of situations in which the "worst case" has actually come to
fruition. For crime, the point is well established. (129) Media coverage
of highly unusual crimes makes people fearful of risks that they are
most unlikely to face. (130) When newspapers and magazines emphasize
deaths from anthrax or mad cow disease, we should expect a significant
increase

in public concern, not only because of the operation of the
availability heuristic, but also because people will not naturally make
sufficient adjustments from the standpoint of probability. In fact,
there is a large warning here. If newspapers, magazines, and news
programs are stressing certain harms from remote risks, people's
concern is likely to be out of proportion to reality. Significant
changes should therefore be expected over time. (131) Across nations, it
is also easy to imagine substantial differences, in social fear, if
small initial differences are magnified as a result of media influences.
(132)

For purposes of understanding those influences, we should
distinguish between the availability heuristic and probability neglect.
When the media emphasizes particular incidents, those incidents will
become cognitively available, and hence they might seem to be far more
probable than they are in fact. Stories involving violent crime and
natural disasters will likely trigger the availability heuristic. At the
same time, an emotionally gripping incident might attract attention
simply because people focus on the outcome and not its likelihood. In
the real world, it will usually be difficult to distinguish the effects
of the two mechanisms. If probability information is disseminated but
ignored, it is, of course, less likely that the availability heuristic
is at work.

It is also true that individuals and even societies differ in their
susceptibility to probability neglect. Of course, countless people take
probability information into account even when the context engages human
emotions. Many people are able to correct their own predisposition to
anxiety, in part by thinking about the low likelihood of harm. But it
also seems clear that many people neglect probability information much
of the time, focusing insistently on the worst case (or, for that
matter, the best). The arsenic experiment, mentioned above, displays a
great deal of individual heterogeneity in taking account of probability.
(133) Those who are peculiarly insensitive to probability information
are likely to do poorly in many domains, including economic markets;
those who are unusually attentive to that information are likely to do
well for just that reason. Perhaps there are demographic differences
here; it is well known that some groups are less concerned about most
risks than are others. (134) The difference in concern may stem, in
part, from the fact that some groups are less likely to neglect
probability.

On the social level, institutions can make a great deal of
difference in decreasing or increasing susceptibility to probability
neglect. Highly responsive democratic institutions, automatically
translating public fear into law, will neglect probabilities when
emotions are running high. A more deliberative democracy would attempt
to create institutions that have a degree of immunity from short-term
public alarm.(135) Cost-benefit analysis, for example, might serve as a
check on regulation that would accomplish little good, or less good than
is justified by the facts. (136) The point raises the general question
of the relationship between probability neglect and regulatory law.

III. PROBABILITY NEGLECT AND REGULATORY LAW

In this Part, I emphasize the possibility that probability neglect
may itself violate administrative law principles, and suggest that an
inchoate understanding to that effect lies behind several important
decisions. I also suggest, more briefly, that an understanding of
probability neglect raises some questions about requirements of risk
disclosure, and that probability neglect often plays a role in the
operation of the precautionary principle, one of the most important
risk-related ideas around the world.

A. Administrative Law.

If emotionally charged outcomes produce intense reactions even
though those outcomes are highly unlikely to occur, how might our
understanding of law be improved? The simplest point is that an
appreciation of probability neglect bears on several issues in
administrative law, involving an agency's obligation, most of the
time, to show the seriousness of any risk that it seeks to regulate.
When agencies are neglecting probability, there are three possible
problems. First, some statutes require an agency to demonstrate that
regulated risks are "significant," and risks might not qualify
as significant if they are exceedingly unlikely to come to fruition.
(137) Second, some statutes require agencies to establish that the
benefits of regulation justify its costs. (138) If an agency is
neglecting probability, it will have great difficulty in establishing
that it has struck the appropriate balance. Third, an agency's
failure to explore the probability of harm might well mean that the
agency has acted arbitrarily, thus violating the Administrative
Procedure Act (APA). (139) As we will see, a number of cases show an
incipient understanding of probability neglect, suggesting, without
using the term that this form of neglect is unlawful. The problem is
that the understanding remains embryonic. Agency practice and judicial
review could be far more attentive to the phenomenon.

Consider, for example, the Occupational Safety and Health Act,
whose provisions are understood to require the agency to regulate only
significant risks. (140) Like many other agencies, the Occupational
Safety and Health Administration (OSHA) is asked to decide when a
probability of harm is high enough to justify regulation. In an early
case, OSHA refused to undertake this inquiry at all, urging the legal
sufficiency of a general finding that a substance was carcinogenic.
(141) In rejecting this argument, the Supreme Court showed an inchoate
awareness of the problems associated with probability neglect. (142) The
Court required the agency to engage in an exercise in quantification, so
as to ensure that the risk was real rather than fanciful. (143) Indeed,
the Court went further. It suggested that if the probability of getting
cancer were one in a billion, it would not be serious enough to justify
regulation, whereas a risk of one in a thousand might well count as
significant. (144) Through encouraging quantitative assessment, the
Court was evidently attempting to ensure that the agency would be
responding to something other than fear of the outcome alone. OSHA has
built on the Court's suggestion, indicating that a risk of
1.64/1000 is significant for statutory purposes, whereas a risk of
0.6/100,000 "may be approaching a level that can be viewed as
safe." (145) When the Court upheld the Council on Environmental
Quality's decision not to require worst-case analysis under the
National Environmental Policy Act, it can be taken to have shown an
understanding of probability neglect. (146) I will discuss this issue in
some detail below, for it is the area in which probability neglect
played its most explicit role in federal environmental law.

But the law remains extremely primitive here. Beyond the statement
just quoted, OSHA has failed to give much guidance about the probability
that should, in its view, trigger regulatory controls. The International
Commission on Radiological Protection recommends that environmental
factors should not be permitted to cause an incremental cancer risk, for
those exposed over a lifetime, of 3 in 1000 or more.(147) But American
practice continues to be extremely variable, and there has been no
effort to ensure uniformity, or indeed to ensure that the question of
probability is investigated systematically or with care. (148) Under its
various programs, the EPA's acceptable range varies from 1/10,000
to 1/1,000,000. (149) In its regulations governing ozone and
particulates, the EPA declined to examine the issue of probability in
quantitative terms, and it was in part for this reason that one court of
appeals invalidated those regulations. (150)

Of course, science will sometimes leave large gaps, allowing
agencies only to specify ranges of probabilities rather than precise
estimates. (151) But ranges themselves can be quite helpful, at least as
a way of disciplining the analysis. Indeed, that point seems to be
recognized in the occasional efforts, within both courts and agencies,
to establish legally sufficient probability thresholds, below which no
regulation will occur. It is possible to go further. An agency's
failure to address the issue of probability raises serious legal
questions, at least when statutes require some form of balancing or a
demonstration that regulated risks have a certain magnitude. Consider in
this light the post-1975 emergence of administrative law principles
permitting, (152) and even requiring, (153) agencies to exempt trivial
risks from regulatory controls. If an agency has not squarely analyzed
the question of probability, it may well be taken to have acted
unlawfully.

The point is especially clear under statutes that require agencies
to balance costs against benefits. The Toxic Substance Control Act
(TSCA), for example, asks the EPA to analyze both the costs and the
benefits of regulation in quantitative terms. (154) As part of that
analysis, the agency will inevitably have to attend closely to the
question of probability, because benefits cannot be quantified without
establishing the likelihood of harm. (155) It follows that probability
neglect would count as a statutory violation, simply because an agency
that fails to investigate probability will be unable to produce the
requisite numbers. (156) Indeed, the leading decision under TSCA
invalidates what the court saw as the EPA's blunderbuss approach to
asbestos, resulting in regulation in cases in which affected people
faced an extremely low risk of harm.

For example, the EPA states that its ban of asbestos pipe will save three
lives over the next thirteen years, at a cost of $128-277 million ($43-76
million per life saved)[;]... that its ban of asbestos shingles will cost
$23-34 million to save 0.32 statistical lives ($72106 million per life
saved); [and] that its ban of asbestos coatings will cost $46-181 million
to save 3.33 lives ($14-54 million per life saved).... (157)

The court's analysis suggests that under statutes that require
cost-benefit balancing, an agency will be forbidden from neglecting the
issue of probability. The major qualification, a point to which I will
return, is that fear is itself a cost and might well impose high
additional costs; it is possible that fear-associated costs can tip the
balance. But even if so, the agency should be under an obligation to
assess, rather than to ignore, the issue of probability.

Of course, probability is not all that matters. If a significant
risk is required, or if costs and benefits must be balanced, the size of
the affected population is important as well. (158) A risk of 1/100,000
is not so troublesome if it is faced by only 100 people (and is thus
expected to produce much less than one death each year); the same risk
is quite serious if it is faced by 200 million people (and is thus
expected to produce 2000 deaths annually). Indeed, there is evidence
that both individuals and regulators neglect the size of the affected
population, no less than probability, especially when intense emotions
are involved. (159) My suggestion is not that probability is all that
matters, but that when probability is disregarded, there is likely to be
a serious problem under many regulatory statutes, and agency action
might well be arbitrary under the APA. And if the analysis here is
correct, judicial review of administrative action shows an implicit
objection to probability neglect, and a number of seemingly disparate
holdings can be unified with the simple suggestion that an agency that
neglects probability will likely be found to have acted unlawfully. Of
course, it is possible that agencies will lack information that would
enable them to assign probabilities with precision or confidence.

B. Disclosure

An understanding of probability neglect also has implications for
disclosure policies in both the public and private sectors. In the past
few decades, many people have been enthusiastic about the idea that
producers of hazards should inform people of the underlying risks, so as
to promote knowledge rather than ignorance and so as to allow for more
informed choices. (160) In the world of regulatory policy, disclosure is
often said to be better than either inaction or command-and-control
regulation, simply because it is less intrusive and allows people to
choose as they wish. (161) In the context of drugs and medical
procedures, it has become familiar for patients to be informed of
low-probability events, including worst-case outcomes, even if the risk
of disaster is exceedingly small.

An understanding of probability neglect raises some cautionary
notes about disclosure policies, at least if the risk being disclosed
involves a miniscule probability of harm. The point is not simply that
people may well misunderstand risk disclosures, perceiving the hazard as
far greater than it is in fact. (162) The problem is that the disclosure
may alarm people, causing various kinds of harms, without giving them
any useful information at all. If people neglect probability, they may
fix, or fixate, on the bad outcome in a way that will cause anxiety and
distress, but without altering behavior or even improving understanding.
Of course, there are difficult issues here about the relationship
between respect for people's autonomy and concern for their
welfare. On one view, disclosure of low-probability risks is justified
on grounds of autonomy even if that' disclosure would increase
anxiety and distress. (163) I will not investigate that view in detail
here. But if people are prone to neglect probabilities, and if we really
are speaking of exceedingly improbable risks, it is by no means clear
that the interest in autonomy justifies disclosure of information that
will not be processed properly. At a minimum, any disclosure, if it is
worthwhile, should be accompanied by efforts to enable people to put the
risk in context.

This point very much bears on the civic responsibilities of those
who disseminate information about risk, including public officials, the
media, and those interested in moving regulatory law in one or another
direction. In view of probability neglect, and the operation of the
availability heuristic, it is not difficult to produce large changes in
public judgments by dramatically increasing fear. Sometimes these
changes are entirely justified as a way of reducing a kind of
complacency, or fatalism, about risks that are real and that should be
reduced. But it is, to say the least, undesirable to take advantage of
the psychological mechanisms used here to provoke public concern when
the risks are statistically miniscule.

C. The Precautionary Principle

Probability neglect sheds light on the appeal and operation of the
precautionary principle, which has played a significant role in
environmental regulation, to the point where it has become ubiquitous.
(164) Variations on the notion can be found in at least fourteen
international documents. (165) The principle can be understood in many
ways, but in Europe it tends to take a strong form, suggesting that it
is important to build "a margin of safety into all decision
making." (166) According to one definition, the precautionary
principle means "that action should be taken to correct a problem
as soon as ,there is evidence that harm may occur, not after the harm
has already occurred." (167) A comparably strong version states:

[T]he precautionary principle mandates that when there is a risk of
significant health or environmental damage to others or to future
generations, and when there is scientific uncertainty as to the nature of
that damage or the likelihood of the risk, then decisions should be made so
as to prevent such activities from being conducted unless and until
scientific evidence shows that the damage will not occur. (168)

There is an obvious difficulty with the precautionary principle:
Both regulation and nonregulation will often give rise to risks; if so,
the principle would seem to be paralyzing, forbidding stringent
regulation, inaction, and everything in between. (169) Consider, for
example, the case of genetic engineering of food. The precautionary
principle might seem to call for stringent regulation of genetic
engineering, on the theory that this technology contains at least some
risk of causing ecological harm. (170) But such regulation would also
create risks of adverse effects, simply because genetic engineering
holds out a prospect of producing ecological and health benefits. (171)
The precautionary principle would seem both to require and to forbid
stringent regulation of genetic engineering. The same can be said for
many activities and processes, such as nuclear power and nontherapeutic
cloning, simply because risks are on all sides of the situation. (172)

How, then, can the precautionary principle seem to offer guidance
in the real world, as it appears to do? (173) A large part of the answer
lies in probability neglect--in the form of intense concern with one of
the set of risks at stake, combined with an unwillingness to investigate
the likelihood that the selected risk will actually come to fruition. In
the case of genetic engineering, fear of the worst-case scenario,
involving severe ecological damage, appears to drive reactions, even
though the worst case is unlikely indeed and even though the alleged
incidents are most often myths. (174) Of course, it might be possible to
revise the precautionary principle in a way that takes account of both
the magnitude and the severity of risks. (175) The suggestion here is
that when the precautionary principle seems to offer guidance, it is
often because of the operation of probability neglect.

IV. LAW: PRESCRIPTIVE, POSITIVE, AND NORMATIVE

I now broaden the viewscreen, asking about the relationship between
probability neglect and law's prescriptive, positive, and normative
tasks. (176) With prescriptive analysis, we seek to find effective ways
to achieve shared goals, positive analysis attempts to explain why law
takes the form that it does, and normative analysis explores what law
should do. I take these up in sequence.

A. Prescriptions: Obtaining Agreed-Upon Goals

Suppose that government is seeking to lead people to achieve goals
on which there is a social consensus. Government might, for example,
want to encourage people to avoid large risks and to worry less over
small risks. If so, it might do well to attempt not to provide
information about probabilities, but to appeal to people's emotions
and to attend to the worst case. With respect to the risks on which it
wants people to focus, government should use vivid images of alarming
scenarios. For cigarette smoking, abuse of alcohol, reckless driving,
and abuse of drugs, this is exactly what government occasionally
attempts to do. It should be no surprise that some of the most effective
efforts to control cigarette smoking appeal to people's emotions,
by making them feel that if they smoke, they will be dupes of the
tobacco companies or imposing harm on innocent third parties--and such
educative efforts work especially by providing vivid images of illness
or even death. (177)

Because of probability neglect, it should not be terribly difficult
to trigger public fear (terrorism is effective in part for exactly that
reason). But there are serious ethical issues here. Government ought to
treat its citizens with respect; (178) it should not treat them as
objects to be channeled in government's preferred directions.
Perhaps government ought not to manipulate or to trick people by taking
advantage of their limitations in thinking about risk. A skeptic might
think that the use of worst-case scenarios, or dramatic images of harm,
amounts to unacceptable manipulation.

While I cannot fully resolve the issue here, the charge seems to me
unwarranted. So long as the government is democratically accountable,
and attempting to discourage people from running genuinely serious
risks, there should be no objection in principle. Those who want people
to run risks, for economic or other purposes, use similar techniques,
(179) and government should probably be permitted to meet fire with
fire. Democratic accountability is important because it is a check on
manipulative behavior; if government is manipulating people in an
objectionable way, citizens are likely to rebel. Of course, the issue is
not simple. In the context of lotteries, state governments use dramatic
images of "easy street" in order to lead people to spend money
for tickets whose actuarial value is effectively zero, and this
strategy, exploiting probability neglect in the domain of hope, does
raise ethical issues. (180) My suggestion is that if government wants
people not to run risks, it is likely to do well if it appeals to their
emotions and ignores probability-based arguments.

There is also a striking asymmetry between increasing fear and
decreasing it. If people are now alarmed about a low-probability hazard,
is there anything that government can do to provide assurance and to
dampen concern? This is an unanswered question. The only clear point is
that government is unlikely to be successful if it simply emphasizes the
low probability that the risk will occur. There appears to be no
evidence that any particular strategy will succeed. (181) But the best
approach may well be simple: Change the subject. We have seen that
discussions of low-probability risks tend to heighten public concern,
even if those discussions consist largely of reassurance. Perhaps the
most effective way of reducing fear of a low-probability risk is simply
to discuss something else and to let time do the rest. (182) Of course,
media attention can undermine this approach.

As I have suggested, institutional safeguards might well be the
best way of ensuring against the harmful consequences of probability
neglect. The Office of Information and Regulatory Affairs, within the
Office of Management and Budget, monitors agency action to ensure that
it is directed against significant problems. (183) A general requirement
of cost-benefit balancing should provide a check on regulations that
cannot be grounded in objective fact. (184) If government wants to
protect itself against the pattern of "paranoia and neglect"
(185) that now characterizes regulatory policy, analytic requirements
and institutional checks will provide a start.

B. Positive Analysis: What Drives the Demand for Law?

If probability neglect characterizes individual judgment under
certain circumstances, might government and law be neglecting
probability under those same circumstances? There is good reason for an
affirmative answer. In the domain of risk regulation, as elsewhere,
public officials are highly responsive to the public demand for law. If
people insist on government protection against risk, government is
likely to provide that protection. If people show unusually strong
reactions to low-probability catastrophes, government is likely to act
accordingly. Of course, interest groups are involved as well. When their
self-interest is at stake, we should expect them to exploit
people's emotions, in particular by stressing the worst case.

1. The Debate over "Worst-Case Analysis"

In the environmental area, there has been an intense debate about
whether the National Environmental Policy Act (NEPA) requires agencies
to discuss the worst-case scenario in environmental impact statements.
(186) Environmental groups have sought to ensure discussion of that
scenario. (187) They have done so in part to stimulate public concern,
with the knowledge that the worst case might well have a great deal of
salience, even if it is highly unlikely. Consider, for example, the
controversy over the possible effects of a development plan on the mule
deer herd in Okanogan County, Washington. (188) In the worst case, the
plan would have devastating effects on the herd. And under the pre-1986
regulations of the Council on Environmental Quality, agencies were
required to include "a worst case analysis and an indication of the
probability or improbability of its occurrence." (189)

In the Reagan Administration, however, this requirement was
deleted, and in the face of uncertainty, agencies were asked not to
explore the worst case, but to investigate only those low-probability
adverse effects that were justified by real evidence as opposed to
conjecture. (190) In the context of risks facing the mule deer herd, the
Forest Service refused to explore the worst case, focusing instead on a
relatively narrow set of possible bad outcomes. (191) It should be easy
to see how the refusal to explore the worst case has broad implications.
It would suggest, for example, that an agency need not investigate the
possibility of catastrophic oil spills in the event that a wildlife
estuary is opened to supertankers, (192) and that the Department of the
Interior, if authorized to promote oil drilling in the Alaska National
Wildlife Refuge, need not explore the worst case of disastrous effects
on local wildlife and wilderness values. (193)

If the account here is correct, the environmental groups were
entirely rational in arguing on behalf of worst-case analysis, (194)
simply because that form of analysis would trigger public attention and
help promote their political goals. Indeed, probability neglect would
lead people to give the worst case a high degree of salience, more in
fact than it deserves. This effect is not necessarily to be deplored; if
environmental problems deserve serious attention, and otherwise would
not receive it, analysis of the worst case might well be a way of
eliminating public torpor. For its part, the government's
abandonment of the requirement of worst-case analysis could be
understood as a response to a belief that people are too likely to
overreact. In this light, the Reagan-era shift was a fully rational
approach to quasi-rationality, meant to protect against the kinds of
distortions that can come from probability neglect. The current
approach, upheld by a Supreme Court that was evidently alert to the
problem, (195) requires consideration of low-probability events, but
only if they are not entirely remote and speculative. And although the
NEPA issue has been resolved, worst-case analysis continues to be an
issue in other areas, (196) and such analysis plays a large role in
popular discussions of risks. (197)

There is an important wrinkle here. While probability neglect makes
worst-case analysis easy to criticize--on the ground that it triggers
excessive public alarm--it might also be defended when regulators are
operating under conditions of uncertainty rather than risk. (198) Under
conditions of uncertainty, probabilities cannot be assigned at all, and
in such cases it is reasonable to follow the maximin principle (choose
the option that has the least-bad worst outcome). (199) If we are
dealing with uncertainty rather than risk, worst-case analysis makes
sense on these standard grounds, simply because it identifies the
approach that should be disfavored by those applying the maximin
principle.

2. The Demand for Law

A good deal of legislation and regulation can be explained partly
by reference to probability neglect when emotions are running high. In
this space, I cannot demonstrate the point rigorously, especially
because many mechanisms contribute to regulatory responses. I have
indicated that it is difficult to know, in particular cases, whether the
availability heuristic is leading to an inflated judgment of
probability, or whether probability is instead being neglected. I have
also noted that interest groups Often exploit heuristics and biases, not
excluding probability neglect, and hence public-choice accounts are
compatible with accounts that emphasize probability neglect. But
consider a few examples: (200)

* In the aftermath of the adverse health effects allegedly caused
by abandoned hazardous waste in Love Canal, the government responded
with an aggressive program for cleaning up abandoned hazardous waste
sites, without examining the probability that illness would actually
occur. In fact, little was accomplished by early efforts to assure
people of the low probability of harm. (201) When the local health
department publicized controlled studies showing little evidence of
adverse effects, the publicity did not dampen concern, because the
numbers "had no meaning." (202) In fact, the numbers seemed to
aggravate fear: "One woman, divorced and with three sick children,
looked at the piece of paper with numbers and started crying
hysterically: `No wonder my children are sick. Am I going to die?
What's going to happen to my children?'" (203) Questions
of this sort contributed to the enactment of new legislation to control
abandoned hazardous waste sites, legislation that did not embody careful
consideration of the probability of significant health or environmental
benefits. (204) Even now, the government does not take much account of
the probability of significant harm in making clean-up decisions. (205)

* During a highly publicized campaign designed to show a connection
between Alar, a pesticide, and cancer in children, the public demand for
action was not much affected by the EPA's cautionary notes about
the low probability of getting cancer as a result of Alar. (206)

* In the summer of 2001, vivid images of shark attacks created a
public outcry about new risks for ocean swimmers. (207) Consider the
fact that a NEXIS search found 940 references to shark attacks between
August 4, 2001, and September 4, 2001, (208) with 130 references to
"the summer of the shark." (209) This was so notwithstanding
the exceedingly low probability of a shark attack and the absence of any
reliable evidence of an increase in shark attacks in the summer of 2001.
(210) Predictably, there was considerable discussion of new regulations
to control the problem (211) and eventually regulations were adopted.
Public fear seemed relatively impervious to the fact that the underlying
risk was miniscule.

* Terrorist incidents create a severe risk of probability neglect.
Consider, for example, the anthrax scare of October 2001, which was
based on exceedingly few incidents. Only four people died of the
infection; only about a dozen others fell ill. The probability of being
infected was exceedingly low. Nonetheless, fear proliferated, with
people focusing their attention on the outcome rather than the low
probability of the harm. The government responded accordingly, investing
massive resources in insuring against anthrax infections. Private
institutions reacted the same way, asking people to take extraordinary
care in opening the mail even though the statistical risks were
insignificant. To say this is not to suggest that extensive precautions
were unjustified in this case. Private and public institutions faced an
unknown probability of a major health problem, and it was appropriate to
respond. Perhaps this was a situation of uncertainty rather than of
risk. (212) My point is that public fear was disproportionate to its
cause and that the level of response was disproportionate too. The same
might well be said of public fears about airplane safety in the
aftermath of the attacks of September 11, 2001, fears that greatly
outran the actual probability of disaster (213) and that led to
extraordinary costs.

3. Jury Behavior

In tort cases, jury behavior is not likely to be affected greatly
by assurance that the risk was unlikely to come to fruition, even if the
issue of probability is legally relevant. (214) In cases involving
low-probability risks of emotionally gripping harms, it should be
relatively easy to convince jurors to produce high damage awards.
Consider, for example, the finding that juries punish corporations that
have engaged in careful cost-benefit analysis, in part by giving higher
punitive damage awards when a high value has been assigned to human
life. (215) This finding raises many puzzles, but it is reasonable to
think that juries focus on the bad outcome and do not think much about
the low, ex ante, probability that it would occur. Indeed, the
probability of detection and compensation has been shown to matter
little to jurors, who assess punitive awards on the basis of their
outrage at the outcome and do not think about whether the harm was
likely to be compensated. (216)

It follows that litigators would do well to try to engage
jurors' emotions by pointing to the worst case or the bad outcome
that actually occurred. There is a strong implication here for the law
of negligence: Even if the law asks the jury to balance the benefits of
the defendant's action against the costs, the jury is likely to
disregard the issue of probability if its attention is focused on an
outcome that triggers strong emotions.

C. Normative Issues

For law, the hardest questions might well be normative ones. It
seems clear that if the public wrongly believes something to be
"safe," and is treating statistically small risks as if they
were zero, government should nonetheless take protective steps. By
hypothesis, people are really at risk, even if some combination of
cognition and emotion is leading them to neglect the danger. There is a
further point. Since the focus of government is population-wide, it
should attend to risks that are large in the aggregate but small for
each individual (whether or not it is rational for individuals to
disregard those risks).

But how should law and government respond to a quasi-rational
public panic, based on an intense emotional reaction to a
low-probability risk? Let us distinguish two possible positions. The
technocrat would want to ignore public irrationality and to respond to
risks if, and to the extent that, they are real. The populist would want
to respond to public concerns simply because they are public concerns.
In my view, both positions are far too simple. Let us begin with the
issue of institutional design.

1. Institutions and Delegation

Suppose that we agree that in some cases, government should not
fall victim to probability neglect, and that it would be foolish, as a
general rule, (217) to spend a large amount of taxpayer resources to
reduce risks that will almost certainly never come to fruition. If so, a
democratic society faces an obvious problem, for elected officers
ordinarily face strong incentives to respond to excessive fear, perhaps
by enacting legislation that cannot be justified by any kind of rational
accounting. The point suggests the importance of ensuring a large role
for specialists in the regulatory process, with the task of engaging in
a kind of "peer review" of legislative proposals. (218) An
understanding of probability neglect thus complements an emphasis on the
risk of "availability bias," through which priorities become
distorted as a result of the use of the availability heuristic. (219)

It is possible to go further. If the public demand for regulation
is likely to be distorted by probability neglect, there are real
advantages to a situation in which the national legislature delegates
policymaking authority to people within the executive branch, at least
if those people are in a better position to judge whether risks are
real. (220) The Office of Information and Regulatory Affairs, in the
Office of Management and Budget, attempts to assess both the costs and
benefits of regulation, in a way that leads to efforts both to prompt
regulations where the potential benefits are large and to discourage
regulations where the potential benefits seem dwarfed by the costs.
(221) Whatever might be said about cost-benefit analysis, it seems
highly desirable for institutions to ensure that expensive regulations
are directed to serious rather than to fanciful problems. Of course,
specialists might be wrong, and even if they are right on the facts, a
democratic society will override their judgments if its values justify
such an override. But if highly representative institutions, responding
to public fear, are susceptible to error, then it is entirely
appropriate to create institutions that will have a degree of
insulation. Democratic governments should respond to people's
reflective values, not to their blunders. But this claim raises some
complexities of its own.

2. Capitulating to Fear?

Suppose that people are greatly concerned about a risk that has a
small or even miniscule probability of occurring--shark attacks, or
anthrax in the mail, or terrorism on airplanes. If government is
confident that it knows the facts, and if people are far more concerned
than the facts warrant, should the government respond, via regulation,
to their concerns? Or should it ignore them, on the ground that the
concerns are irrational?

Consider the individual analogy first. Even if a person's fear
is irrational, it might well be rational for him to take account of that
fear in his behavior. If I am afraid to fly, I might decline to do so,
on the ground that my fear will make the experience quite dreadful (not
only while flying but also in anticipating it). At the same time, the
fear itself might be irrational, and I might even recognize that fact.
If the fear exists, but if I cannot eliminate it, the most rational
decision might be not to fly.

So too at the social level. Suppose, for example, that people are
afraid of arsenic in drinking water and that they demand steps to
provide assurance that arsenic levels will not be hazardous. Suppose too
that the risks from existing levels of arsenic are infinitesimal. Is it
so clear that government should refuse to do what people want it to do?
The fear is, by hypothesis, real. If people are scared that their
drinking water is "not safe," they are, simply for that
reason, experiencing a significant loss. In many domains, widespread
fear helps produce an array of additional problems. It may, for example,
make people reluctant to engage in certain activities, such as flying on
airplanes or eating certain foods. The resulting costs can be extremely
high. (222) Why shouldn't government attempt to reduce fear, just
as it attempts to produce other gains to people's well-being?

Compare the issue of hope in this regard. State governments
encourage people to purchase lottery tickets, and in doing so they call
people's attention to the best-case outcome, with vivid images of
the great riches that are available to the victors. The analysis here
suggests that governments are taking advantage of probability neglect to
manipulate people into paying what is, in effect, a regressive tax. But
it would be possible to respond that hope is itself a subjective good,
and that those who buy lottery tickets, with the best case firmly in
view, are able to enjoy life more than they would if they simply
calculated the discounted value of the tickets. Certainly lottery
tickets give people far more than they would get by paying the same
amount in taxes. If this argument is plausible, because hope is an
independent good to be encouraged even if it is quasi-rational, then
perhaps fear too should be reduced, because it is an independent bad
even if it is quasi-rational.

The simplest answer here is that if government is able to inform
and educate people, it should do that instead. It should not waste
resources on steps that will do nothing other than reduce fear. But the
simplest answer is too pat. Whether information and education will work
is an empirical question on which we lack definitive evidence. If these
do not work, government should respond, just as individuals do, to fears
that are quasi-rational but real and, by hypothesis, difficult to
eradicate. Suppose, for example, that government could cheaply undertake
a procedure that would reduce a tiny risk to zero--and equally
important, be seen to reduce the relevant risk to zero. It seems clear
that government should take this step, which may be more effective and
less expensive than education and information. Recall that fear is a
real social cost, and it is likely to lead to other social costs. (223)
If, for example, people are afraid to fly, the economy will suffer in
multiple ways; so, too, if people are afraid to send or to receive mail.
The reduction of even baseless fear is a social good, not least because
of the potentially enormous "ripple effects" associated with
it. (224)

At the same time, there are some practical complications. If
government attempts to reduce fear by regulating the activity that
produces it, it might well intensify that very fear, simply by
suggesting that the activity is worth regulating. As an analogue,
consider the debate over whether the government should require
genetically modified food to be labeled as such. (225) Mandatory labels
might be criticized on the ground that they suggest a danger that does
not in fact exist. Sometimes the fear that accompanies probability
neglect diminishes over time, as experience moves the activity or
process from the cognitive category of "unsafe" to
"safe." (226) A regulatory approach might prevent this process
(salutary when the risk really is low) from occurring. If so, inaction
would be the preferred course.

Even if it is clear that government should respond, many questions
remain. How and how much should government respond? The answer must
depend in large part on the extent of the fear and the cost of the
response. If people are extremely fearful, a substantial response is of
course easier to justify; if the cost of response is very high, a
refusal to respond might well make sense. (227) With this point, the
analysis of appropriate action becomes similar to the analysis in many
other settings. We need to know how much good, and how much harm, would
be done by the action in question.

A special difficulty here consists in the problem of quantifying
and monetizing fear and its consequences, a problem that has yet to be
seriously engaged in the relevant literature. (228) Without having any
information on that question, the intensity of public concern might be a
helpful proxy. As a presumption, there should be no governmental
response to fear that is ungrounded in reality. But if the fear has
resulted in a strong movement for political response, we have good
reason to think that the fear needs to be addressed. Here, as elsewhere,
information is the best response. But if it proves ineffective, low-cost
interventions, designed to eliminate the fear, seem to be justified.

V. CONCLUSION

In this Essay, my central claim has been that the probability of
harm is often neglected when people's emotions are activated,
especially if people are thinking about the worst-case scenario. If that
scenario is vivid and easy to visualize, large-scale changes in thought
and behavior are to be expected.

The general phenomenon helps to explain public overreaction to
highly publicized, low-probability risks, including those posed by
abandoned hazardous waste dumps, nuclear waste disposal, and anthrax.
Because rational people focus on the probability as well as the severity
of harm, probability neglect is a form of quasi-rationality. (229) I
have also suggested that people try to avoid cognitive dissonance,
sometimes by thinking that they are "safe" and by treating a
low-level risk as if it were zero. This too is a form of probability
neglect, one that can lead people to subject themselves to risks that,
over time, have significant cumulative effects. The problem can be still
more serious for governments, which deal with large populations and
which should therefore address risks that are statistically small at the
individual level.

It follows that if a private or public actor is seeking to produce
public attention to a neglected risk, it is best to provide vivid, even
visual, images of the worst that might happen. It also follows that
government regulation, affected as it is by the public demand for law,
may well neglect probability too. If so, there are likely to be serious
legal questions. An agency that neglects probability may be unable to
establish a significant risk; such an agency will certainly have
difficulty in demonstrating that the benefits of regulation outweigh its
costs. If a statute requires an agency to establish that regulation is
"requisite to protect the public health" or welfare, (230)
that agency might be required to investigate the issue of probability to
establish that regulation is indeed "requisite." (231) An
understanding of probability neglect therefore illuminates some
embryonic developments in administrative law; (232) it might also pave
the way toward more definitive developments in the future.

There are larger normative issues in the background. If the public
is neglecting a real risk, and wrongly believing itself to be
"safe," surely government should respond. At first glance,
however, the government should not respond if the public is demanding
attention to a statistically miniscule risk, and doing so simply because
people are visualizing the worst that can happen. The best response is
information and education. But public fear is itself an independent
concern, and it can represent a high cost in itself and lead to serious
associated costs. If public fear cannot be alleviated without risk
reduction, then government can reasonably engage in risk reduction, at
least if the relevant steps are justified by an assessment of costs and
benefits. (233)

(26.) For varying views, see generally JON ELSTER, ALCHEMIES OF THE
MIND: RATIONALITY AND THE EMOTIONS (1999) (arguing for a mostly
cognitive view of the emotions, but emphasizing arousal); and MARTHA C.
NUSSBAUM, UPHEAVALS OF THOUGHT: THE INTELLIGENCE OF EMOTIONS (2001)
(supporting a highly cognitive view of the emotions without emphasizing
arousal).

(27.) Much research suggests that the brain has special sectors for
emotions and that some types of emotions, including some fear-type
reactions, can be triggered before the more cognitive sectors become
involved at all. JOSEPH LEDOUX, THE EMOTIONAL BRAIN 157-65 (1996). Those
who hear sudden, unexplained noises are fearful before they are able to
identify the source of the noise. R.B. Zajonc, Feeling and Thinking:
Preferences Need No Inferences, 35 AM. PSYCHOLOGIST 151 (1980); R.B.
Zajonc, On the Primacy of Affect, 39 AM. PSYCHOLOGIST 117 (1984). People
who have been given intravenous injections of procaine, which stimulates
the amygdala, report panic sensations. David Servan-Schreiber &
William M. Perlstein, Selective Limbic Activation and Its Relevance to
Emotional Disorders, 12 COGNITION & EMOTION 331 (1998). In research
with human beings, electrical stimulation of the amygdala leads to
reported feelings of fear and foreboding, even without any reason for
these emotions, leading people to say, for example, that they feel as if
someone were chasing them. Jaak Panksepp, Mood Changes, in 1 HANDBOOK OF
CLINICAL NEUROLOGY 271,276 (P.J. Vinken et al. eds., 1985). It is not
true, however, that fear in human beings is generally precognitive or
noncognitive, and even if it is in some cases, it is not clear that
noncognitive fear would be triggered by most of the risks faced in
everyday human lives. On the general idea of "dual
processing," both heuristic and systematic, see DUAL-PROCESS
THEORIES IN SOCIAL PSYCHOLOGY (Shelly Chaiken & Yaacov Trope eds.,
1999).

(28.) For the term, see RICHARD H. THALER, QUASI RATIONAL
ECONOMICS, at xiii (1991). There is, however, an important
qualification: the difference between risk and uncertainty. See infra notes 198-199 and accompanying text. The basic point is that in
circumstances of risk, probabilities can be assigned, whereas under
circumstances of uncertainty, probabilities cannot be assigned. When
people are unable to assign probabilities, they might do well to focus
on the worst case, as a way of following the maximin principle.

(29.) See Clayton P. Gillette & James E. Krier, Risk, Courts,
and Agencies, 138 U. PA. L. REV. 1027, 1061-85 (1990) (defending the
idea of competing rationalities). I do not mean to deny that some of the
time ordinary people care, rationally, about values that experts
disregard. All I mean to suggest is that insofar as people focus on the
badness of the outcome but not on its likelihood, they are thinking less
clearly than experts, who tend to focus on the statistical deaths at
stake.

(30.) See SLOVIC, supra note 12, at 113.

(31.) Cf. HOWARD MARGOLIS, DEALING WITH RISK 91-92 (1996)
(emphasizing that when ordinary people differ from experts, it is often
because ordinary people do not see the tradeoffs involved).

(33.) Consider here the expenditure of large sums of money on state
lotteries, sums that result in part from vivid mental images of good
outcomes; consider also the fact that some people are willing to spend
significant sums to avoid risks that have a very low probability of
coming to fruition.

(38.) Studies show that when people discuss a low-probability risk,
their concern rises even if the discussion consists mostly of apparently
trustworthy assurances that the likelihood of harm really is
infinitesimal. See Ali Siddiq Alhakami & Paul Slovic, A
Psychological Study of the Inverse Relationship Between Perceived Risk
and Perceived Benefit, 14 RISK ANALYSIS 1085, 1094-95 (1994); Donald J.
MacGregor et al., Perception of Risks from Electromagnetic Fields: A
Psychometric Evaluation of a Risk-Communication Approach, 14 RISK
ANALYSIS 815, 826-28 (1994). Consider the fact that President Bush, in
encouraging Americans to fly in the aftermath of the 9/11 attack,
emphasized not the low probability of terrorism, but his view that
flying would be a patriotic act.

(41.) For a general argument that strong emotions can drive out
other considerations, see George Loewenstein, A Visceral Account of
Addiction, in SMOKING: RISK, PERCEPTION, AND POLICY 188, 189-95 (Paul
Slovic ed., 2001).

(61.) But see W. KIP VISCUSI, FATAL TRADEOFFS 51-74 (1992)
(reporting a number of studies that show a wage premium for risky jobs,
and that suggest, though do not prove, that differences in low
probabilities will be reflected in wages). It does seem clear that
automobile prices are correlated with differences in the probability of
serious harm as a result of accidents, in a way that shows attention to,
not neglect of, probability variations. Id.

(62.) See Corso et al., supra note 48, at 166.

(63.) Kunreuther et al., supra note 49 at 103.

(64.) This tendency is noticed and criticized in the context of the
Clean Air Act in MARC K. LANDY ET AL., THE ENVIRONMENTAL PROTECTION
AGENCY: ASKING THE WRONG QUESTIONS 78-82 (1994).

(65.) KAI T. ERIKSON, EVERYTHING IN ITS PATH: DESTRUCTION OF
COMMUNITY IN THE BUFFALO CREEK FLOOD 234 (1976).

(66.) SHELLEY E. TAYLOR, POSITIVE ILLUSIONS 9-12 (1989).

(67.) See GEORGE AKERLOF & WILLIAM DICKENS, The Economic
Consequences of Cognitive Dissonance, in AN ECONOMIC THEORIST'S
BOOK OF TALES 123, 124-28 (1984).

(84.) Note that the phrasing of the question ensures that
participants would think of the reduction of the risk to zero, rather
than to some fraction of what it was before. As I have noted, people are
willing to pay far more to eliminate risks than to reduce them, even if
the savings are identical. See Kahneman & Tversky, supra note 18, at
20-22.

(85.) See Corso et al., supra note 48, at 166.

(86.) The data were analyzed using a 2-by-2 ANOVA (Probability by
Emotionality of Description) for overall means, and by using t-tests
within cells.

(87.) Throughout the results, the medians tell a similar (and
generally stronger) version of the same story as the means, although
they must be interpreted with caution due to the small number of
response categories. In particular, most of the medians are either 50 or
100, and these are the only two response options between 25 and 200.
Consequently, there is a substantial range of underlying
"true" medians that would result from unconstrained WTP
responses that are consistent with the observed pattern of medians in
this study. Means are less sensitive to this feature of the responses.

(88.) F(1,81) = 7.6, p < 0.01.

(89.) The medians show a similar pattern.

(90.) See supra note 49 and accompanying text.

(91.) See Corso et al., supra note 48, at 166.

(92.) F(1,81) = 1.8, p = 0.19. This relatively small effect might
be a product of the fact that even the less emotional description did,
after all, involve a cancer death, which is known to produce strong
reactions. See Richard L. Revesz, Environmental Regulation, Cost-Benefit
Analysis, and the Discounting of Human Lives, 99 COLUM. L. REV. 941,
972-73 (1999). A more pronounced effect might be expected if the death
was simply described as "a death."

(93.) Loewenstein et al., supra note 21, at 276.

(94.) Id.

(95.) Id.

(96.) Id.

(97.) Note a converse point: Anticipated gain is a social benefit,
even if its likelihood is low. If people receive substantial benefits
from anticipating winning the lottery, there is a point in favor of
having lotteries, even if almost everyone loses--at least if the pain of
the loss does not outweigh the pleasure of the anticipated win.

(103.) Id. at 106-07. Consider in particular the following
suggestion:

When people are upset about a high-outrage, low-risk situation,
explanations coming from the distrusted source of the trouble may not help
much; merely providing risk probability data also may not help much, even
if the source is trusted. But considerable reductions in threat perception
and action intentions are possible when a trusted, neutral source offers a
comparison to background or a chat with a risk ladder, risk comparisons,
and an action standard.

(113.) It would be tempting to venture an evolutionary explanation
for probability neglect. While plausible, such an explanation would be
highly speculative: We could imagine evolutionary explanations both for
probability neglect and for intense concern with probability.

(122.) To be sure, it is not clear whether probability neglect is
always or entirely irrational at the individual level. People often lack
information, and acquiring additional information is often costly,
especially when it involves arcane issues such as the probability of
harm associated with certain acts and processes. Lacking information,
people might focus on the worst outcome associated with various
alternatives as a way of following the maximin principle. See infra
notes 198-199 and accompanying text. But experts and governments can do
a great deal better, at least when probability information is available
to them.

(128.) See Joshua Greene et al., An fMRI Investigation of Emotional
Engagement in Moral Judgment, 293 SCIENCE 2105 (2001). The authors are
concerned with two well-known problems in moral philosophy. The first,
called the trolley problem, asks people to suppose that a runaway
trolley is headed for five people, who will be killed if the trolley
continues on its current course. The question is whether you would throw
a switch that would move the trolley onto another set of tracks, killing
one person rather than five. Most people would throw the switch. The
second, called the footbridge problem, is the same as that just given,
but with one difference: The only way to save the five is to throw a
stranger, now on a footbridge that spans the track, into the path of the
trolley, killing that stranger but preventing the trolley from reaching
the others. Most people will not kill the stranger. But what is the
difference between the two cases, if there is any?

The authors do not attempt to answer the question in principle, but
they find "that there are systematic variations in the engagement
of emotions in moral judgment," id. at 2106, and that brain areas
associated with emotion are far more active in contemplating the
footbridge problem that in contemplating the trolley problem, id.
Probability neglect involves facts, not values, but it is reasonable to
speculate that similar findings about the brain would distinguish cases
where probability neglect does not occur from those where it is
especially pronounced. Though I cannot establish it here, I believe that
this point, about dual-processing with respect to both facts and values,
has large and thus far unexplored implications for both political and
legal theory. The discussion here of probability neglect can be seen as
a tentative effort to explore those general implications.

(129.) See JOEL BEST, RANDOM VIOLENCE: HOW WE TALK ABOUT NEW CRIMES
AND NEW VICTIMS (1999).

(130.) Id. at 1-7.

(131.) For an account of fears of criminal violence, see id. at
48-92.

(132.) For a discussion of multiple equilibria, see Kuran &
Sunstein, supra note 17, at 743-46.

(150.) This was part of the motivation for the ruling of the court
of appeals in American Trucking Ass'n v. EPA, 175 F.3d 1027, 1052
(D.C. Cir. 1999) (invalidating ozone and particulates regulations in
part because of absence of clarity about harms that would trigger
regulation), rev'd sub nom. Whitman v. Am. Trucking Ass'n, 531
U.S. 457 (2001). The relevant regulations were upheld, in their
essentials, in American Trucking Ass'n v. EPA, 283 F.3d 355 (D.C.
Cir. 2002).

(158.) See JAMES T. HAMILTON & W. KIP VISCUSI, CALCULATING
RISKS: THE SPATIAL AND POLITICAL DIMENSIONS OF HAZARDOUS WASTE POLICY
91-108 (1999) (emphasizing this point in the context of a criticism of
the EPA for focusing solely on the probability of harm, and neglecting
the size of the exposed population, under the Superfund statute).

(159.) On the general neglect of the size of the affected
population, see the overviews in BARON, supra note 44, at 500-02; and
SUNSTEIN, supra note 135 (manuscript at ch. 2). On the effects of
emotions in crowding out concern With numbers, see Christopher K. Hsee
& Yuval Rottenstreich, Music, Panda and Muggers (unpublished
manuscript, on file with author).

(181.) But see supra note 103 (discussing how to inform people of
probabilities).

(182.) Recall in this regard President Bush's effort, in the
aftermath of the terrorist attacks of 9/11, not to emphasize that the
statistical risks were low, but to treat flying as a kind of patriotic
act, one that would prevent terrorists from obtaining victory.

(183.) For an overview, see Office of Mgmt. & Budget, at
http://www.whitehouse.gov/omb/inforeg/regpol.html (last visited May 24,
2002).

(205.) See HAMILTON & VISCUSI, supra note 158, at 91-108
(discussing the lack of government interest in the size of the
population affected).

(206.) See PERCIVAL ET AL., supra note 186, at 436.

(207.) One journalist described the recent hue and cry over shark
attacks in the following terms:

A maritime expert said on last night's "NBC Nightly News" that more people
die from bees, wasps, snakes or alligators than from shark attacks. But
there's no ratings in bees. Unpleasant little critters, but not
scary-looking enough. With "Jaws" music practically playing in the
background, the media have turned this into the Summer of the Shark. Never
mind that the number of attacks has actually dropped since last year.
They're here, they're nasty and they could be coming to a beach near you.

(208.) Results of a NEXIS News search, Sept. 4, 2001. In fact, Time
offered a widely discussed cover story on sharks and shark attacks under
a screaming cover entitled, "Summer of the Shark." See Terry
McCarthy, Why Can't We Be Friends?: A Horrific Attack Raises OM
Fears, but New Research Reveals Surprising Keys to Shark Behavior, TIME,
July 30, 2001, at 34. The story itself suggested that the probability of
being attacked by a shark is about 1/30 the probability of being struck
by lightning. Id.

(209.) Results of a NEXIS News search, Sept. 4, 2001.

(210.) For data on shark attacks, see Florida Museum of Natural
History, The International Shark Attack File, at
http://www.flmnh.ufl.edu/fish/Sharks/ISAF/ISAF.htm (last visited May 24,
2002). The site offers comparative risk data showing, for example, that
while there were 18 shark injuries and deaths in the United States in
1996, there were over 10,000 injuries and deaths from buckets and pails,
over 1,500 injuries and deaths from toilet bowl products, and over
198,000 injuries and deaths from nails, tacks, screws, and bolts. Id.

(211.) See Maya Bell, Divers Defend Courting the Fish So Many Fear:
A Wave of Recent Shark Attacks Has Brought South Florida Shark-Feeding
Groups Under State Scrutiny, ORLANDO SENTINEL, Aug. 29, 2001, at A1.

(222.) The mad cow disease scare is an example, producing several
billions of dollars in losses. Econ. Research Serv., USDA, Dissecting the Challenges of Mad Cow and Foot-and-Mouth Disease, AGRIC. OUTLOOK,
Aug. 2000, at http://www.ers.usda.gov/publications/AgOutlook/aug2001/AO283c.pdf.

(223.) My point here is not that all subjective perceptions and
losses should be counted in law. Many people, for example, like to
discriminate on the basis of race and sex, and they suffer a genuine
loss, for which they might be willing to pay, as a result of the legal
prohibition on discrimination. I do not believe that their loss should
be counted, though I will not defend the point here. For a useful
discussion, see Matthew D. Adler & Eric A. Posner, Implementing
Cost-Benefit Analysis When Preferences Are Distorted, in COST-BENEFIT
ANALYSIS 269 (Matthew D. Adler & Eric A. Posner eds., 2001).
Although the fear discussed in this Essay is not fully rational, it
cannot be said to be invidious or vicious, and hence cannot be
"impeached" in the same way as discriminatory preferences.

(226.) See the treatment of dichotomous approaches to risk in
MARGOLIS, supra note 31, at 82-83. As I have suggested, the belief that
processes and activities are either safe or unsafe is itself a form of
probability neglect.

(227.) Note that if the government is regulating in order to
diminish public fear, it might well produce an odd form of
redistribution, helping those who are irrationally fearful and hurting
those who are not. Recall that there are significant variations in
people's susceptibility to probability neglect; some people are far
less susceptible than others. In these circumstances, a costly
intervention will provide no benefits to those who are not fearful and
will assist only those who are (by hypothesis senselessly) afraid. But
this form of redistribution should not be troublesome if it would not
create unfortunate dynamic incentives to fall victim to probability
neglect, and it would be odd if redistributive regulation of this kind
actually created such incentives. It is not unreasonable to speculate
that less-educated people are more prone to probability neglect than
more-educated people, and since education is correlated with wealth, the
redistribution being discussed here would tend to give disproportionate
help to the poor.

(228.) For a good overview of that literature, see W. KIP VISCUSI,
RATIONAL RISK POLICY (2000).

(229.) Note that to the extent that people lack information about
probabilities and are in a situation of uncertainty rather than of risk,
probability neglect seems defensible as a response to limited
information. See supra notes 198-199 and accompanying text.

(233.) I have not said anything here about the difficult issue of
how to monetize public fear.

Cass R. Sunstein ([dagger])

([dagger]) Karl N. Llewellyn Distinguished Service Professor,
University of Chicago, Law School and Department of Political Science. I
am grateful to Jon Elster, Christine Jolls, George Loewenstein, Eric
Posner, Richard Posner, Avishalom Tor, and Adrian Vermeule for helpful
comments on a previous draft. I am also grateful to participants in
valuable workshops at the Harvard Law School and the John F. Kennedy
School of Government at Harvard University. Special thanks to David
Schkade for indispensable help with the analysis of the experiment in
Section II.D.

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